External Insurance Act Judicial Management Regulations Forms & - PowerPoint PPT Presentation

 External Insurance Act  Judicial Management Regulations  Forms & Fees Regulations  Classes of Insurance Business Regulations  Capital Requirements for External Insurers, Insurance Managers, External Insurance Brokers 2

This presentation applies to all regulated External Insurance licensees in this jurisdiction and, those financial institutions and individual body corporate who propose to carry on external insurance business from within or outside The Bahamas. The detailed information presented is intended to apprise you of:  Definitions for the purposes of the new External Insurance Act, 2009 and External Insurance Regulations, 2010 and, Information.  The expectations and requirements of The Insurance Commission of The Bahamas vis-à-vis the External Insurance Act, 2009 and the External Insurance Regulations, 2010.  Indicators implemented to assess the prudential effective oversight of the External Insurer’s business affairs.  Information to assist every licensee with statutory requisites. 3

At the outset it is important to note the following:  The Information presented is based on The Insurance Supervisory and Regulatory system of the Commonwealth of The Bahamas by means of The Insurance Commission of The Bahamas, ―the Commission‖ or ―ICB‖ established under section 4 of the Insurance Act (Act No. 16 of 2005 as amended July 2, 2009).  The responsibilities of The Insurance Commission of The Bahamas are not only with respect to overall risk management but also to exercise prudential oversight and, to ensure prudential soundness and supervisory regulations from within and outside The Bahamas. 4

The Insurance Commission of The Bahamas, in exercise of the powers conferred statutorily by Section on 46 of the External rnal Insuranc rance Act, 2009, made External Insurance Regulations and provisions with respect to the following: The licensing, re-registration, operation, conduct and activities of all external  insurers. The licensing, re-registration, operation, conduct and activities of Insurance  Managers. The licensing, re-registration, operation, conduct and activities of External  Insurance Brokers. Prescribing anything that is required by the External Insurance Act, 2009 Act to  be prescribed. Exempting any person or class of persons or business or class of business from  any provision of the External Insurance Act, 2009. Constituting the breach of any provision of the External Insurance Act, 2009 or  of any regulation to be an offence. Prescribing anything that is required with respect to the financial obligations or  requirements under the External Insurance Act, 2009. Where there is no provision, or not sufficient provision of the External Insurance  Act, 2009 in respect of any matter or thing necessary to give effect to the External Insurance Act, 2009, the manner or form in which the deficiency is to be supplied. 5

 Statutorily, regulations may contain such incidental or supplemental provisions as appear to the Commission to be expedient for the purposes of the regulations.  Additionally, the Commission may from time to time issue rules, guidelines and directives for the better management of licensees or insurance managers and external insurance brokers under the External Insurance Act, 2009.  That essential to The Insurance Commission of The Bahamas’ regulatory framework are strict adherence by all body corporate to the External Insurance requisites and, the monitoring and compliance with The Bahamas’ applicable Laws and Regulations. 6

 The rules, regulations and the players have changed drastically in the past year especially when compared with the External Act, 1983; therefore it is crucial, I repeat crucial, that all external insurers must pay close attention to the new External rnal Insura urance nce Laws that will certainly be beneficial to every stakeholder.  No person shall carry on external insurance business from within The Bahamas, nor hold himself out as carrying on external insurance business from within The Bahamas, without a license under the External Insurance Act, 2009.  The Commission shall satisfy itself that the provisions of the anti-money laundering legislation are being complied with.  No person will be re- registered if all of the statutory requirements have not been satisfied, i.e. you must be compliant. 7

For the purposes of this presentation, of note are the following DEFINIT NITIONS ONS fo for r the purp rposes oses of f the G GUIDEL DELINES INES concerning: RE RE-REGISTRATION REGISTRATION, , AS ASSESSMENT ESSMENT OF OF RESPONSIBL PONSIBLE E PERSONS SONS an and RESIDENT IDENT REPRESEN RESENTATIVE TATIVE INF NFORMATION. ORMATION. 8

―body corporate‖ means any body corporate including a body corporate  constituted under the law of a country or territory outside The Bahamas. ― carry y on externa rnal l insu suran ance ce busines iness ‖ and its derivatives, includes: -  opening or maintaining a place of business or an office, or appointing or using a ◦ representative in The Bahamas, whether or not insurance business is being arranged in or from The Bahamas; and the use in The Bahamas of any business description or business title, in any ◦ language whatever, of the words ―insurance‖, ―assurance‖, ―indemnity‖, ―guarantee‖, ―underwriting‖, ―reinsurance‖, ―surety‖, ―casualty‖, or any derivatives, or any expression which connotes or is intended to connote insurance business. the making in The Bahamas of any representation in any handbill, letter, letterhead, ◦ circular, advertisement, paper notice, or in any manner whatsoever offering, either directly or indirectly, to arrange contracts of insurance; the assumption of the obligation of a company to cover risks or liabilities in any class ◦ of insurance business; and insurance business where the risk is located outside The Bahamas. ◦ ―class of insurance business‖ means any class of insurance business as  determined by regulations. 9

 ―company‖ means body corporate .  ―the Commission‖ means The Insurance Commission of The Bahamas (ICB) established under section 4 of the Insurance Act ( Act No. 16 of 2005 ).  ―external insurer‖ means a company carrying on external insurance business.  ― externa rnal l insuran urance broker‖ is a company licensed under the External Insurance Act, 2009 (not being an external insurer) who, for commission or other compensation brings together, with a view to carrying on external insurance business, persons seeking insurance or reinsurance and insurance or reinsurance undertakings, carries out work preparatory to the conclusion of contracts of insurance or reinsurance, and where appropriate, assists in the administration and performance of such contracts.  ― externa rnal l insuranc urance business‖ means insurance business where the risk is located outside The Bahamas. 10

―insurance‖ includes ―reinsurance‖ unless the context requires otherwise.  ―insurance business‖ means the business of effecting and carrying out  contracts of general insurance business, long term insurance business and any other form of insurance business and including but not limited to :- ◦ protecting persons against loss or liability to loss in respect of risks to which such persons may be exposed; or ◦ to pay to a person a sum of money or other thing of value upon the happening of an insurable event, and includes running-off insurance business including the settlement of claims ―insurance manager‖ means a person that provides or holds himself out  as providing insurance management services to one or more persons. ―insurance management services‖ includes the provision of accounting,  administrative, brokerage, underwriting, and claims processing services in respect of external insurance business. 11

 ―net premium income‖ means premium income less any premiums or other considerations paid by the licensee for reinsurance.  ―overseas regulatory authority‖ means an authority which, in a country or territory outside The Bahamas, exercises functions corresponding to any functions of the Commission or the Superintendent.  ― resident ent or princip cipal l represe sentat ntativ ive ‖ means a licensee’s management company or such individual as the Commission approves for the purpose of managing the business of a licensee.  ― restri ricte cted external nal insure urer ‖ means an external insurer that only underwrites the risks of:- ◦ its members, subsidiaries and affiliates; reinsureds, not being members, subsidiaries and affiliates, who acknowledge in writing that they know and accept that the external insurer is a restricted insurer; and, ◦ such other persons as the Commission may approve.  ―unrestricted external insurer‖ means an external insurer that is not a restricted external insurer. 12